Reply To: Losses killing my wins

#186450
Christian Harris
Participant

    You’re using a negative risk-to-reward strategy, so your potential loss on a trade is greater than the possible gain.

    Consistently engaging in trades with a negative risk-to-reward ratio can lead to significant losses over time, even if a relatively high percentage of trades are successful.

    This is because the losses on unsuccessful trades can quickly outweigh the gains from successful ones.

    Swap to a positive risk-to-reward strategy, where the potential reward exceeds the potential risk. For example, a 2:1 or 3:1 ratio means the potential gain is two or three times the potential loss.

    Such strategies are generally preferred as they offer a better balance between risk and reward, and you don’t have to be right every time to make money.

    A 20-pip SL is also quite tight when trading FX, so consider expanding that slightly.

    Good luck.